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25. It has to be borne in mind that the decision in W.P.(MD) Nos.2127, 2117, 2121, 2152, 2159, 2160, 2168, 2177, 2500, 2530, 2532, 2534, 2538, 2539, 2540, 2503 & 2504 of 2021 was rendered by the Court on 24.02.2020 in the earlier round of litigation. There, a reference was made to the decision of this Court rendered in Shri Vinayaka Agencies Vs. The Asst Commissioner, CT Vadapalani, 2013 60 VST 283, wherein, this Court had earlier held that the Commercial Tax Department does not have jurisdiction to reverse the input tax credit availed by on the ground that the selling dealer had not paid tax. In Paragraph No.8, the Writ Court in its order dated 24.02.2021 in the case of these petitioners had rightly concluded that the said decision in Shri Vinayaka Agencies Vs. The Asst Commissioner, CT Vadapalani, 2013 60 VST 283 may not apply to the facts of the case as it was rendered under the previous regime namely Tamil Nadu Value Added Tax Act, 2006.

26. It has to be also borne in mind that the Division Bench of this Court in a batch of Tax Cases, Writ Appeals in Tvl.Sahyadri Industries Limited Et cetera Vs. The State of Tamil Nadu Et cetera, 2023 (4) TMI 912; [2023] 115 GSTR 320 (Mad) has substantially watered down the ratio of the Writ Court in Shri Vinayaka Agencies Vs. The Asst Commissioner, CT Vadapalani, 2013 _____________ https://www.mhc.tn.gov.in/judis W.P.(MD) Nos.22371 of 2023 etc., batch 60 VST 283 (cited supra) with the following observations:-

99. The learned Single Judge however observed that it is another matter if the selling dealer has not paid the collected tax and that liability has to be fastened on the selling dealer. Liability cannot be however mulcted on the purchasing dealer who had shown proof of payment of tax on the purchases made.
100. To an extent we are in agreement with the view of the learned single judge in Sri Vinayaga Agencies Vs. Assistant Commissioner (CT), Vadapalani-I Assessment Circle, Chennai and Another, MANU/TN/1386/2013 : (2013) 60 VST 283 (Mad). However, the view cannot be applied universally where the selling dealer continued to exist where there was no transaction of "sale" or that the registration was obtained only for the purpose of facilitating credit of tax being availed without a transaction of sale. We cannot uphold the view in Sri Vinayaga Agencies Vs. Assistant commissioner (CT), Vadapalani-I Assessment Circle, Chennai and Another, MANU/TN/1386/2013 : (2013) 60 VST 283 (Mad) in all cases merely because the registration of the selling dealer was not cancelled if indeed the registration was obtained to create paper transaction without actual sale. The burden to prove that there was indeed a transaction of sales is with the registered dealer availing credit. Till such burden is proved, the credit availed under the proviso to Section 19(1) of the TN VAT Act, 2006 can be denied.
101. We have to state that ratio of this Court both in Jinsasan Distributors vs. Commercial Tax Officer, Chennai, MANU/TN/1771/2012 : (2013) 59 VST 256 and Sri Vinayaga _____________ https://www.mhc.tn.gov.in/judis W.P.(MD) Nos.22371 of 2023 etc., batch Agencies vs. Assistant Commissioner (CT), Vadapalani-I Assessment Circle, Chennai and Another, MANU/TN/1386/2013 : (2013) 60 VST 283 (Mad) are no longer a good law in the light of the recent decision of the Court in The State of Karnataka vs. M/s.Ecom Gill Coffee Trading Private Limited, dated 13.03.2023 in Civil Appeal. No. 230 of 2023. We shall deal with the same in due course of discussion.